A Preview of ObamaCare's "Rescue" Programs

With good news about ObamaCare in such short supply, supporters of the health overhaul law are circulating widely an article published in the Los Angeles Times written by a California woman grateful for her coverage under one of the law’s early programs.

Called “ObamaCare to the rescue,” the article by Spike Dolomite Ward describes how “A woman who felt President Obama had let the middle class down has changed her mind.”

She and her husband had been forced by harsh economic times to drop their family’s health insurance policy, but Mrs. Ward learned three weeks ago that she has breast cancer. She writes:

Fortunately for me, I’ve been saved by the federal government’s Pre-existing Condition Insurance Plan, something I had never heard of before needing it. It’s part of President Obama’s healthcare plan, one of the things that has already kicked in, and it guarantees access to insurance for U.S. citizens with preexisting conditions who have been uninsured for at least six months.

Which brings me to my apology. I was pretty mad at Obama before I learned about this new insurance plan. I had changed my registration from Democrat to Independent, and I had blacked out the top of the “h” on my Obama bumper sticker, so that it read, “Got nope” instead of “got hope.” I felt like he had let down the struggling middle class. My son and I had campaigned for him, but since he took office, we felt he had let us down.

So this is my public apology. I’m sorry I didn’t do enough of my own research to find out what promises the president has made good on. I’m sorry I didn’t realize that he really has stood up for me and my family, and for so many others like us. I’m getting a new bumper sticker to cover the one that says “Got nope.” It will say “ObamaCares.”

(It’s probably only a coincidence, but when the president was asked recently if he objects to people using the term ObamaCare to describe the health law, he said he doesn’t have a problem with people thinking “Obama Cares.”)

The problem of helping people with pre-existing conditions get coverage could have been solved with a few pages of legislation, not the 2,800-page overhaul we got. The conservative “replace” plans will offer much better solutions.

Blogger Robert Tracinski has an insightful response to Ward’s op-ed in his post for Real Clear Markets entitled “We pay for ‘free’ health care, Obama gets the thanks.” Tracinski is similarly situated to Ward but has continued to pay his health insurance premiums. He writes:

[This] is a classic case of “What Is Seen and What Is Not Seen.” That is the title of an indispensable essay written in 1848 by the French economist Frédéric Bastiat, who pointed out that when the government bestows its largess, we tend see only the benefits coming down from above: there are press releases and newspaper articles and a lady writes an op-ed in the LA Times. What we don’t see is where that money came from and who it came from, and what else we might have done with that money…

Some of the people reading the LA Times will conclude that they should vote for Obama, which is Ward’s intended message. But some of them will draw a more practical conclusion and drop their health insurance. Why struggle on the treadmill of paying tens of thousands of dollars in premiums, when they have just been assured that they can wait until a serious illness strikes and grab government-subsidized insurance then? Ward says that by dropping her health insurance, she took a gamble and lost. Now that she is advertising how she was bailed out, how many other people will be encouraged to take the same gamble?

That was the point I made here in my commentary last month for The Wall Street Journal about the inevitable failure of the individual mandate in the law.

Tracinski concludes: “Ward admits that she didn’t do enough of her own research to understand what was in ObamaCare. But she still hasn’t; marveling at the fact that you just got free stuff does not count as ‘research.’…Instead of giving the credit to Obama, she might consider offering us an apology and some thanks for continuing to pay our premiums so that she didn’t have to.”

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HSAs threatened: So much for President Obama’s promise that “If you like your health care plan, you will be able to keep your health care plan. Period. No one will take it away. No matter what.” That likely won’t be true for many of the more than 11 million people with Health Savings Accounts.

HSAs may not survive ObamaCare because of regulatory language written by Obama administration officials to implement the law. (If an explicit prohibition would have put this in the legislation directly, it likely never would have passed. But the reg writers can try to quietly suffocate HSA with a regulation buried in a 400+ page rule.

Investor’s Business Dailyreports that “A new Obama administration rule could drive out of the market the low-cost, high deductible plans that are supposed to be available under ObamaCare.”

The article explains the mind-numbing complexities of the regulation that will basically mean many HSAs won’t be able to meet a key test to meet new federal government standards.

The bottom line: “Most affordable policies would go off the market,” said Roy Ramthun, who played a major role in writing HSA regulations during the Bush administration.

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Our new paper on health coverage losses: Even before the law fully takes effect, millions of people are losing the coverage they have now, and tens of millions more surely will follow, as we explain in our new paper, “A Radical Restructuring of Health Insurance.”

Some insurance carriers are leaving the market because of onerous state regulations, others are victims of a faltering economy, but the cascade has been accelerated by the rules that already have taken effect and the many more that are to come as a result of ObamaCare.

Our paper provides an overview of carriers that are leaving the private health insurance market; the impact of Obama administration rules on the child-only health insurance market; the disruptions caused by rules governing health premium payouts and “grandfathering;” and the threats to the Medicare Advantage market.

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Testimony next week: I’ll be testifying next week on the issue of health insurance before the House Committee on Small Business during a hearing on “New Medical Loss Ratios: Increasing Health Care Value or Just Eliminating Jobs?” It will be before the Subcommittee on Investigations, Oversight and Regulations, chaired by Rep. Mike Coffman (R – CO).

The hearing will take place Thursday, December 15, at 10:00 A.M. in room 2360 of the Rayburn House Office Building. Join us in person or tune in on the committee’s website.

GALEN IN THE NEWS

A Radical Restructuring of Health Insurance

Grace-Marie Turner
Galen Institute, 12/11

Health plans across the country are leaving the small group and individual health insurance markets, forcing people to find other sources of coverage. In this paper, we provide examples of how millions of people in dozens of states already are being negatively impacted by the law — from New York to Colorado, Virginia to Florida, and Connecticut to Indiana. The paper provides an overview of carriers leaving the market; the impact of Obama administration rules on the child-only health insurance market; the disruptions caused by rules governing health premium payouts and “grandfathering;” and the threats to the Medicare Advantage market.Read More »

Obamacare’s Fatal Flaws

The list of reasons to dump ObamaCare goes on and on. Congress made a serious drafting error in the health-overhaul law when it said that subsidies could be delivered through state exchanges but not through any federal fallback exchanges. The Obama administration has been trying an end-run around the problem by ordering the IRS to simply say in its proposed regulations that the subsidies can be delivered through either type of exchange. Sen. Orrin Hatch blew the whistle on the proposed IRS rule, saying the law is clear that only state exchanges can offer the subsidies, emphasizing that the administration doesn’t have the authority to go beyond the language of the law.Read More »

CLASS Act: Not Dead Yet

The House Energy and Commerce Committee has approved a bill to repeal the controversial long-term entitlement program — the CLASS Act — in ObamaCare, following the administration’s admission that the Ponzi scheme program is unworkable. The president still has vowed to veto any repeal legislation, but if CLASS were left on the books, Secretary Sebelius might be required to find a way to implement it next year. The Congressional Research Service has concluded: “The Secretary does not appear to have discretion to decide whether or not to designate a plan by October 1, 2012.” Given this, you might assume that Secretary Sebelius would encourage the president to sign the repeal legislation, lest she and her department face legal action for violating the law they worked so hard to enact.Read More »